9 December 2019: The UK Prudential Regulation Authority (PRA) has issued three of Citi’s European operations with a collective £44m fine after it uncovered “serious and widespread” failings in Citi’s reporting. The PRA found that, over a period of four years, the firm’s UK regulatory reporting framework was “not designed, implemented or operating effectively.” In particular, the firm failed to report on its liquidity or on its capital – information that it was legally required to provide.
The PRA held that, while Citi continually hit their liquidity goals, the failings were widespread and persisted over a long period of time so as to warrant a fine. They had led to significant errors in the firms’ returns, including six substantive matters. As such, their returns were unreliable and did not provide an accurate picture of their liquidity position to the PRA.
Ultimately, the PRA held that Citi had failed to ensure that it had designed, implemented and was effectively operating the required systems and controls. Its approach to technical interpretations had been insufficiently robust, and the PRA found that Citi’s oversight and governance in relation to regulatory reporting feel significantly below the expected standards.